Technically Challenged

Dilbert isn't the only one out there with a boss who doesn't get it. The value that IT can deliver to a company continues to be misunderstood by business leaders who are . . . Technically Challenged.

He is the EXECUTIVUS OBSOLETUS - the dark-suited manager of IBM TV commercial fame who finds himself on exhibit in a museum alongside dinosaurs and woolly mammoths because he simply cannot or will not keep up with technology.

Stripped of that metaphor, he is the older executive so used to relying on his secretary to handle what used to be paper tasks that he cannot save a file or open a spreadsheet without help. He is sufficiently embarrassed about his lack of IT literacy that he has become an expert at hiding it. Yet he is also the decision-maker pushing the IT developments or holding the keys to the cashbox for the IT projects on which his business will ultimately depend.

While his species' numbers are steadily diminishing, executivus obsoletus is nowhere near becoming extinct. And there is something about him that captures the public imagination, at least in the business and IT communities, because when New York-based Jennifer Shaheen issued a press release last year about all those senior executives perched atop the corporate ladder without knowing their apps from their elbows, the story ran with only slight variations on TV and in papers and magazines across the US.

Certainly the story's slightly raunchy tone was guaranteed to catch an editor's eye. The version issued by Associated Press, which varied only slightly from those running elsewhere across the US, began: "She often meets her powerful clients on nights and on weekends, when no one is around. Some of them insist she call only on their mobile phones, fearing the loose lips of secretaries. Yet there is nothing unsavoury about Jennifer Shaheen's line of work.

"Shaheen, 32, is a computer tutor to corporate big shots, giving pointers in the fine arts of opening e-mail attachments, navigating Excel spreadsheets and performing other PC chores the executives' minions probably can do in their sleep."

However, behind the story's clever tone and innuendo, say Australian observers, lies a disturbing reality.

"We've taught and coached executives and managers, sometimes in their homes, on how to do certain IT tasks related to their personal IT use," says Christopher Hire, senior consultant for Sydney-based consultancy Simple. "Their understanding of IT is typically poor unless they're under 50, but a lot of the executives are getting towards the upper end of that bracket: late 40s to 60, let's say. A lot of them, we've found, don't understand what they're doing. They can't do IT when they're away on the road. They can't work on their files offline. When they're not connected to the network, there's not a great awareness of the features of the products they could be using."

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Hire is not the only one to believe this lack of computer literacy can seriously hamper effective corporate decision-making on IT. And before you get too smug, you should know that some CIOs are as technologically illiterate as some CEOs and board members.

"At the end of the day, the typical CEO or top level executive at these larger companies is, for all intents and purposes, clueless when it comes to computer literacy," says Scott Testa, US software company Mindbridge's vice president of marketing. "We even had an ex-CIO who had worked with us who couldn't figure out how to send an e-mail.

"Ultimately the success of many companies is based upon the strength of their information technologies. So if you have the head of a company that doesn't understand [computers or] isn't computer literate then by nature you have a problem," Testa says.

Randolph Kahn, principal of Illinois-based Kahn Consulting, has a particularly chilling story from his shame files. "We were at a client site not too long ago where we were forced to educate the CIO and the CTO on a certain technology they had implemented. It became very embarrassing when we had to educate them on the ways in which their technology was functioning, which was different to their perception of what was happening," says Kahn. "It was an uncomfortable situation to have to educate the senior-most technology professional in a Fortune 100 company about the technology that they've spent millions of dollars on."

Angela Lewis of Angela Lewis Consulting, an Australian commentator and writer on issues related to the societal impact of technology, and lecturer in IT education, says the problem is compounded because many senior executives do not see IT training to be inherently valuable in any way for them. That is partly because they get someone else to do their computer-type tasks - "that is why I have a PA" - but it is also because many PAs take it upon themselves to do everything for their bosses.

"I know one [PA] for example who opens and prints her boss's e-mails and leaves them on his desk. He then dictates his answers and she responds, but will also add an addendum to it saying: 'He really means xyz'," Lewis says.

"Non-IT savvy executives pursue training when lack of it starts to interfere with their workloads. For example, they get annoyed at the fact that the PA has trouble explaining how to download e-mail from the laptop if they are sitting in a hotel room in Hong Kong and need to read figures without someone printing them out for them."

Lewis says it's typically this type of frustration or an embarrassing situation that prompts executives to improve their computer literacy. An important presentation that they must give personally, or finding themselves in a meeting where all the other senior people have pulled out PDAs or laptops when they do not even know which hole to plug the mouse into, can do the trick.

Tammy Erickson, senior executive with The Concours Group, believes the problem is both widespread and unsurprising, considering you can fairly safely assume that every executive over the age of 50 took his or her college exams "using a slide rule". That means senior officers generally grew up in a vastly different technology world than the youngest members of the workforce, many of whom began using computers in primary school.

"Ironically, this group of executives, those between 50 and retirement age, have probably had the most difficult time of any age group in mastering the computer - not because of a lack of aptitude, but because of a lack of time," she says. "Many studies show that retirees typically become quite literate because they have the time to explore the computer and get comfortable with its uses. Many working executives have never had that luxury. They've mastered the computer's most rudimentary functions, perhaps e-mail and word processing, but for many the more sophisticated uses are lost in the press of complex executive and family responsibilities."

But Erickson says however challenging technology is to these executives, they do acknowledge the value of technological competencies. For example, a number of years ago, she led a series of seminars designed for companies that were deemed the "best of the best" in their respective industries. One of the most interesting insights she took away from that experience was completely unexpected: the consistent pattern of technological sophistication that existed among the senior management of these diverse firms.

"I've thought about it many times since and it's not clear to me if personal mastery of technology is the chicken or the egg, but I'm convinced this knowledge is critical for leaders of successful firms, regardless of their firm's specific focus," Erickson says.

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Making Decisions in the Dark

Does a CEO's lack of technical nous really matter to the organization at large? CEO of US-based computer training company CM IT Linda Burzynski thinks it does.

"One of the key facts we see in business today is the need to stay current with the ever-changing world of technology," Burzynski says. "The most competent CEOs and directors fully understand technology impacts every facet of their enterprise including communication, accounting functions, advertising and marketing, legal, productivity and ultimately, the bottom line. No CEO or director can be up to date on all of the demands and opportunities prevalent today through technology. Smart CEOs and directors surround themselves with smart executives and outsourced IT firms who possess the expertise to apply technology in the real world of business today."

However, surrounding yourself with people who know more than you do may not always be enough to ward off disaster. Bad technology decisions way too often send shock waves all the way through companies, but ultimately end up at the doorstep of a CEO or a CIO, according to Kahn.

"I think it's a huge problem," he says. "If you think about all the technology implementation failures, you have to ask yourself who is making those decisions. Is policy driving those decisions? Do [decision-makers] truly understand the functionality that they need to be able to harness if the technology is to make the place run faster and better? One has to ask why it is that so many failures happen with such tight budgets. With a much more competitive landscape you would think that the C class executives would be paying much more attention to how they're spending their finite resources in both buying and implementing technology."

Instead, organizations frequently buy new software because no one understands they could achieve a desired result with their existing software. Time-poor executives are a major contributing cause, Kahn says. Or the organization will buy a US product that requires a fortune to customize, because buying from SAP or IBM gives insecure executives a sense of security.

"There is an old saying - 'Nobody gets fired for buying IBM' - and while certainly it's not as bad as it used to be, there are organizations that pay a million dollars or so for a solution that could otherwise be got from a local [Australian] firm for $50,000," Hire says. "Plenty of our associates report that. They say that it's quite frustrating when people go and buy a content management system that costs a million dollars when they only need a $20,000 or $50,000 solution."

The other problem that can occur when decision-makers do not understand IT, Hire says, is a tendency to think in the short term and not consider lifetime costs of IT solutions. "They might think: 'Well this will solve our problem this year', but they don't look at how much it will cost them over the life of the technology."

However, Hire points out that gaps in executives' understanding of IT are not always their fault. There is a hole in the university education of IT executives, he says. "A lot of university courses are well and truly out of date by the time the students graduate. The information is out of date, so the executive that does an MBA for instance, might find that the IT component is not that practical or useful to him in understanding [technology] issues."

A good manager will try to fill in these gaps, Hire says.

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Getting Better

Alan Thorogood is a Ph.D student who teaches at the Australian Graduate School of Management (AGSM). His current area of research is how business executives are making decisions around IT investments.

IT decision-making has improved over the past four or five years, Thorogood says, and the improvement is showing up in statistics revealing more projects are succeeding, but he says there remains considerable scope for improvement. IT infrastructure is particularly problematic. IT infrastructure represents about 50 percent of IT expenditure, yet that infrastructure spend does not fit the dominant decision-making mechanism, Thorogood says. Executives who fail to understand infrastructure could be setting their organization up for trouble.

"Boards and executives look at net present value (NPV) business cases - that's what they're looking for in order to approve investments. We need some frameworks to engage senior executives in these decisions, because infrastructure doesn't have any directly attributable positive cash flows," he says. That encourages some CIOs having trouble justifying business cases for infrastructure to add business projects into the business cases to make them NPV positive. The result, says Thorogood, is that they end up with massive business projects whose sheer size increases their chances of failure.

Thorogood says there is a general realization by board members and executives that they are generally weak in IT, as is evidenced by growing demand for the Managing Information Technology course created as part of the AGSM Executive MBA program a few years ago.

"So there is a gradual realization that something needs to be done," he says. "And the issue is around engagement. It's around engaging senior managers in IT so that IT people know that they need to talk to the senior management, and the senior managers are now realizing they need to direct these decisions themselves, rather than leaving it up to the CIO to make the decisions. So there's a general awareness around a number of issues."

Perhaps the worst potential impact of a lack of computer and technical literacy among executives is the potential breakdown of communication. Concours's Erickson says from the original re-engineering days forward, there has been the assumption that technology can, in part, link people, information and parts of the process together in ways that were never before possible. The fundamental logic of this approach disappears, however, if key participants in the process are unable to function within the technical flow.

"In today's highly technological world, the need for technical fluency is greater than ever," she says. "There are many reasons why understanding computers and other aspects of information technology initiatives are critical to executives in any company and in any part of the world." Erickson says technology literacy is:

• Both a tool for and a symbol of excellence today. Simply put, excellent companies are run by technically sophisticated executives.
• A critical skill for participating effectively in the organizational processes of most companies today because redesigned processes and process-based organizations require computer literate participants.
• A window on today's world - understanding today's consumer behaviour requires understanding how younger consumers live with technology.

Technology literacy also gives executives the tools and perspective required to understand their customers. The best way to understand how markets will evolve is to be intimately engaged in relevant activities, Erickson says. Understanding younger, computer literate consumers requires staying current with their latest tools.

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Getting Them Up to Speed

To overcome their failings, executives need to "just do it", Erickson says. Top executives and boards need to insist that computer literacy is a key requirement for all senior managers.

Boards must include people who live regularly in the technology world, and who are in strong positions to determine whether or not the glimpses they get into the corporation's technology make sense and are sufficient. Technology needs to figure prominently in the board's agenda - giving these representatives the exposure they need to judge how technology is being used in the firm.

"The board and senior executives should insist upon adequate investment in systems-related education and training, regular audits of systems in use and ongoing executive participation in information technology demand management," she says. "The Field of Dreams formula - 'If you build it, they will come' - seldom works with IT.

"Most companies concentrate on improving the supply of information systems when they should also be concentrating on improving the demand. And I don't mean raising the demand, but improving the ability of business people to use information systems in their work and decision-making, and to work effectively with IT to design, develop and deploy new technology-enabled business capability."

Finally, Erickson says, senior executives and boards need to ask the right questions, continually probing whether technology is working as a force to integrate the firm's operations. According to Erickson, some key questions include:

• Is the company leveraging technology in our most important business initiatives?
• Do we have the platforms necessary for success today and tomorrow?
• Are we capitalizing on the business potential of the Internet?
• Are we managing the resources effectively?
• Is our management and shareholder information of the highest accuracy and integrity?
• Are we leveraging IT to ensure business continuity?
• Are we leveraging technology for business innovation and learning?

If all else fails, and especially if the problems are symptomatic of a wider cultural problem within the organization, it might need to adopt a "new broom approach", says Australian Computer Society (ACS) national president Edward Mandla.

That might mean appointing new board members, a new CEO, or perhaps even a new CIO who can really take a stand on the use of IT to enable growth, and to help the board focus on strategic issues like quality of service delivery, speed to market and innovative product development.

"We certainly feel that board education is very important, and we're concerned about these things," Mandla says. "We're concerned about ICT knowledge of board directors. We don't know why it is, but we don't see any ICT people on boards. And we certainly know that there are no courses to better equip a board to make major ICT decisions, and that's certainly something that we're [the ACS] looking at doing at the moment."

It's a worthy mission. Some hands-on training might convert directors and CEOs from powerful-but-inept users into power users - and see executivus obsoletus replaced by executivus conversari.

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SIDEBAR: CEO Types

What category best represents the CEO at your company?

The Hypocrite, who espouses strategic importance of IT but negates belief through personal action.

The Believer, who believes IT enables strategic advantage and demonstrates belief through action.

The Waverer, who reluctantly accepts strategic importance of IT.

The Monarch, who accepts IT is important, appoints the best CIO and steps back.

The Agnostic, who concedes IT is important but needs repeated convincing.

The Zealot, who is convinced IT is important and equally believes he is an IT expert.

The Atheist, who is convinced IT is of little value and publicly espouses this belief.

Source: The creeds were originally defined in a Sloan Management Review article.

SIDEBAR: Helping Them Get It

People who have worked with technically-challenged bosses have come up with specific educational strategies that help. A few follow:

A little empathy goes a long way. Think of how you feel when you take your car in with a mysterious grinding noise. You're in over your head. You don't understand the systems, the complexity or the diagnosis. You have no basis for evaluating anything. That's how your boss feels every day.

Recognize that ego is involved. Help him save face. Don't humiliate him for what he doesn't know.

Don't talk techie. He either won't get it or will try to pretend he does.

Talk business. If he doesn't understand the impact of computers being down, talk about the implications in lost revenue and customer complaints that will result if automated invoices don't go out. If you want new development tools, talk about benefits in productivity, dollar and time savings, and revenue generation.

Communicate in his preferred style. If he likes things in writing, for example, write.

Take him to seminars, conferences and site visits to organizations that use IS in creative ways. Then spend time exploring what you heard and how it might apply to your organization. You'll build a relationship as you educate him.

Arrange staff presentations for the boss and make sure the staff is talking in lay terms. You'll be educating the boss, training your staff to talk with business clients and helping them know and trust each other.

Bring in the experts. Take him to management consultant seminars, and back up your arguments with articles and consulting reports. It helps for him to know it isn't just your opinion.

Help him communicate with his bosses. Give him what he needs to succeed with his superiors.

Establish trust. Resist the temptation to put one over on him. Build up his confidence that you know what you're doing - that if you say so, it's a fact.